Insolvency Service facing lawsuit over alleged leak to newspaper

Businessman Dermot Desmond and members of his family are taking the proceedings over the alleged leaking of confidential material concerning an agreement to buy a property that had been owned by developer Sean Dunne.

The case centres around a December 2016 agreement by a trust set up to the benefit of Mr Desmond’s four children to purchase a property known as ‘Walford’ on Dublin 4’s Shrewsbury Road from its owners, the Cypriot-registered Yesreb Holdings.

Mr Desmond (settlor of the trust), his children Zoe, Brett, Ross and Derry and the Isle of Man-registered Celtic Trustees Ltd claims confidential material in letters sent to the defendants about the agreement appeared in the Sunday Business Post three days later.

Due to the alleged “leak”, the Desmonds claim their right to privacy was breached and they are seeking damages, including aggravated and punitive damages, from the defendants.

Mr Lehane and the ISI deny the claims and say they did not disclose any material to any third party, nor did any breach of privacy or confidentiality occur.

They say they are not responsible for the newspaper’s conduct, against whom no proceedings have been issued by the plaintiffs.

They claim the plaintiffs ought to have known any purchase agreement for Walford would result in significant controversy given the media interest in Mr Dunne’s bankruptcy.

Issues concerning the ownership of Walford, which was bought for €58 million by Mr Dunne in 2005, are the subject of separate legal actions before the Commercial Court.

The plaintiff’s claimed that after the sale agreement was entered into, Mr Lehane, who is the official in charge of Mr Dunne’s bankruptcy, brought legal proceedings against Yesreb and registered a lien or a lis pendens against Walford.

On 5 January 2017, Mr Desmond’s solicitor, in a letter marked private and confidential, wrote to Mr Lehane requesting that the lis pendens be vacated.

The letter also disclosed Mr Desmond was the settlor of the trust, the only beneficiaries were his children, and that the trust had acquired the property from Yesreb on 6 December 2016.

The following day, in a reply from Mr Lehane’s lawyers, Mr Desmond was informed the lis pendens would not be vacated, that the property was beneficially owned by Mr Dunne, and the trust should provide Mr Lehane with certain details about the sale.

The plaintiffs claim the correspondence was disclosed to third parties, including a journalist, as details in the letters appeared in the Sunday Business Post on 8 and 15 January 2017.

They allege the leak, which they claim came from the defendants, breached their right to privacy resulting in them suffering loss and damage.

The case came before Ms Justice Caroline Costello on Friday when both sides brought pre-trial motions seeking the discovery of certain documentation they say is relevant to their pleadings.

The plaintiffs sought discovery from the defendants of all documents relating to any communications by the defendants to any media outlet in relation to the Sean Dunne bankruptcy or related litigation.

They claimed it was necessary to establish their claim that the defendants were the source of the leak.

This was opposed by the defendants on the grounds what was being sought was not necessary and a fishing expedition.

The defendants said it had agreed other categories of discovery including all documents relating to any communications by the defendants to media outlets referred to in the correspondence between the parties between 5-15 January 2016.

In its application the defendants sought all documents relating to the sale agreement in respect of Walford, which the plaintiffs had refused to provide.

In her ruling, Ms Justice Costello said she was satisfied not to make the discovery order sought by the plaintiffs for “a combination of reasons” including that the material sought was “speculative”.

However she ruled the material sought by the defendants was relevant to case being advanced and should be provided to the defendants within eight weeks.

Aodhan O Faolain, Ireland International News Agency Ltd.